Predictive Discovery Reconfirms Bankan Gold Potential (ASX:PDI)

Predictive Discovery Reconfirms Bankan Gold Potential (ASX:PDI)

The Predictive Discovery Ltd [ASX:PDI] share price has reversed losses suffered last week thanks to new drilling results at its Bankan Project in Guinea.

Despite announcing a potential significant extension at the northern eastern part of Bankan, the PDI share price was pushed down by the lower gold price.

But with the gold price now looking like it has levelled out, new high-grade intersections at the project have begun to reverse PDI’s downwards trend.

At time of writing the PDI share price is up 12.50% to trade at 7.2 cents per share.

ASX PDI Share Price Chart - Predictive Discovery

Source: Tradingview

The power of confirmation

We mention often here at The Daily Reckoning Australia about how explorers often release results that claim to have progressed exploration at their project, though the market barely reacts.

If you were ever confused about this phenomenon, today is a perfect example.

Let me explain.

Last week, PDI announced it had identified possible mineralisation north of the current gold zone at Bankan.

Which would extend the gold zone to 1.6km.

But the share price sank that day.

Why?

Because, at the time, it told us very little about the actual resource.

Today is a good example of what happens when drilling results build more confidence in the resource.

ASX PDI Bankan Gold Project Cross Section 1

Source: Predictive Discovery

Here is a cross-section from Bankan with some of the drilling results released today (blue).

Notice the east-west dipping drill holes intersect broad areas of mineralisation.

REVEALED: What’s Next for Aussie Gold Stock Prices? Learn more.

But imagine how these areas would look without the east-west dipping intersection.

You’d be left guessing.

Which is why today’s results have received a positive share price reaction.

ASX PDI Bankan Gold Project Cross Section 2

Source: Predictive Discovery

Here’s another example.

The drilling running diagonally left to right help paint a more accurate picture of what’s happening beneath the surface.

Commenting on the results, PDI Managing Director Paul Roberts said:

This is a very positive outcome, suggesting that open pit mining at greater depths in fresh rock will be supported by better gold grades, and supporting our belief that we can target open-pittable gold mineralisation to a vertical depth of at least 200m.

Drill results to date have also highlighted the generally strong continuity of gold mineralisation at NE Bankan, both down-dip and across-dip. We are seeing long runs of good gold grades in both directions, suggesting excellent gold mineralisation continuity, which bodes well for the planned Maiden Resource Estimate.

Building suspense

Exploration has been progressing well at Bankan.

But with the current drill program going on a month-long hiatus from mid-September, we could see a break in news from the project.

PDI said upon completion of the current drill program, results will be compiled and reviewed to guide drilling orientation in the next drilling phase.

If all goes to plan, we could see a maiden resource estimate by Q2 2021.

According to PDI’s last quarterly cashflow statement, the explorer had about 3.8 quarters of available funding as of June 2020.

Meaning we could see a capital raise in the near future.

There is a fair bit to like about PDI currently, but before you rush into a gold play make sure you’re across the big trend happening in ASX gold stocks. Australia could be set to become the next gold epicentre. Our resident gold expert Shae Russell is tipping a big spike in Aussie gold stocks as we look set to knock China off the top spot. If you want to know more, click here to download your free report.

Kind regards, 

Lachlann Tierney

For The Daily Reckoning Australia